Mortgage lending remains subdued

Gross lending by the 52 UK building societies in August 2009 was £1.5 billion, and building societies' approvals totalled £1.3 billion in August 2009.

Commenting on the figures, Adrian Coles, BSA Director-General, said: "Gross lending was subdued in August, but appears to be at broadly similar levels to recent months after seasonal factors are adjusted for.

However, the market remains very depressed compared to previous years.

"Despite signs of a modest improvement in market conditions in recent months, activity will not return to normal levels until funds for mortgage lending are more widely available to building societies and other lenders."

In the savings market, balances held in savings accounts at building societies fell £202 million in August 2009. Excluding any interest credited to accounts, building societies experienced a net withdrawal of £473 million.

Commenting on the figures Mr Coles said: "Balances held at building societies fell in August, which signals that savers are continuing to withdraw more money than they save. This is not surprising given the very low Bank Rate, and the difficulties faced by many households, with job losses rising and income growth remaining subdued. These factors are affecting all deposit-takers in the UK."